Legal Question in Business Law in California

If you file a lawsuit against a corporation and win a money judgment, you become a creditor. The corporation remains liable if is ceases to do business, however, if the corporation dissolves according to law and applies whatever assets it has to satisfaction of its debts, which might not include your judgment, there is no one and no money to go after.

On the other hand, if the insiders such as officers, directors or stockholders give any corporate money or property to themselves before paying the non-insider creditors in full, they may be personally liable to you for taking the corporation's assets before taking care of its debts.

Collecting judgments is an art, just like collecting other kinds of bad or troubled debts. If a large sum is at issue, you may want to hire a lawyer who specializes in collecting judgments.

The other attorney is right on point here. What do you mean by going out of business? Has the corporation been wound up and dissolved? If so, and unless there is a serious sum that warrants hiring legal talent, it may not be worthwhile. Consult with a good business attorney in your area for specific advice.

Mr. Franchise - Kevin B. Murphy, B.S., M.B.A., J.D.

Franchise Attorney

I agree with both attorneys. If you need a free consultation with a collections attorney in San Diego, I am available.